Wal-Mart will face more challenges on health insurance

Published January 22, 2006 12:01 am
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A new Maryland law that forces Wal-Mart Stores Inc. to spend more on employee health insurance is spurring lawmakers in 33 states to push similar bills, health-care and union activists said.

''Fair-share health care is going to sweep the nation,'' said Vincent DeMarco, president of the Maryland Citizens' Health Initiative.

Last week, the Maryland Legislature overrode Gov. Robert Ehrlich's veto to become the first state to effectively force Wal-Mart, the nation's largest retailer, to boost employee health-care spending.

Starting next year, the Fair-Share Health Care Plan will require private companies with more than 10,000 employees in Maryland to spend at least 8 percent of payroll on health coverage, or make a contribution to the state's insurance program for the poor.

Wal-Mart, with about 17,000 employees in the state, is the only large company known to fall short of the 8 percent spending requirement.

Naomi Walker, director of state legislative programs for the AFL-CIO, said that since the veto override in Maryland, other state lawmakers are feeling a ''new excitement'' about pushing for more employer health coverage, especially from Wal-Mart. (It could not be determined whether any such move is afoot in Utah.)

''We're hearing stories from around the country of legislators who are fighting among each other about who is going to be the one to introduce the bill,'' she said.

At a briefing, the activists said that in Washington state and Wisconsin, legislatures have started conducting hearings on such bills.

In Florida, ''they are in the process of putting together the legislative pieces'' to fit with existing state laws, said Rich Templin, spokesman for the AFL-CIO in Florida. ''There is bipartisan support for this bill,'' which will be introduced within days, he said in a telephone interview.

Similar preparations are under way in Georgia, Ohio and other states where lawmakers have been inspired by developments in Annapolis, Walker said.

Last Thursday, Wal-Mart spokesman Nate Hurst issued a statement predicting that the Maryland law and others like it would ''fail to control the soaring cost of health care [and] . . . cost jobs and slow economic growth.''

Wal-Mart notes that Maryland has 786,000 uninsured people, ''and less than one-half of 1 percent work for Wal-Mart.''

The retailer also points out that more than three-fourths of its employees have health coverage. In Maryland, both full-time and part-time Wal-Mart workers can become eligible for company health coverage that costs as little as $23 a month, the company said.

Wal-Mart supporters argue that the company's employees are only slightly more likely than their counterparts at other large retailers to collect Medicaid, the federal-state health care program for low-income people.

But union officials and health-care activists say Wal-Mart stints on health coverage and shifts those costs to taxpayers, who fund Medicaid. That is unfair to both taxpayers and the Wal-Mart competitors who provide more generous health-care coverage, they say.

''Health-care costs have gone out of control,'' Maryland Sen. Gloria Lawlah, a Democrat and a lead sponsor of the legislation, said at the briefing. Unless large, profitable companies provide reasonable health coverage for employees, state budgets will be swamped by costs associated with helping uninsured families, she said.

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